For Binance, regulation in the crypto sector is key to the growth of the entire industry. This was said by CEO Changpeng Zhao in a public letter.
The text was published after weeks of controversy surrounding Binance. First the events in the UK with the ban on Binance Market Limited, one of the branches of Binance in the UK. Then the Cayman Islands, which challenged the lack of authorization of the exchange. Finally, the risk of a class-action lawsuit from Italy due to platform problems that caused a group of investors to lose their money.
All of this has shone a spotlight on the position of the world’s largest exchange vis-à-vis regulators.
CEO and founder Changpeng Zhao has taken direct action to clarify any doubts or suspicions.
In his text, CZ made it clear that Binance’s approach has always been to protect consumers. This is evidenced not only by security systems such as the Secured Asset Emergency Fund (SAFU) but also by the rigorous procedures adopted by the exchange prior to listings, or even tutorials and the Binance Academy to educate traders.
CZ says that Binance has also always cooperated with the authorities in case of investigations. In 2021, the exchange intervened in 5,600 suspected cases, the most notorious of which involved $500 million in money laundering from dark web operations and cyber attacks.
All this has happened in just 4 years of the life of Binance, which can still be considered a start-up.
In fact, Binance was born in 2017, at a time when the crypto industry was still immature, and regulations were effectively not there. Now things are changing and there is more focus on regulation. According to CZ, this is positive:
“More regulations are, in fact, positive signs that an industry is maturing, because this sets the foundation for a broader population to feel safe to participate in crypto. I believe a well-developed legal and regulatory framework in the long term will be a solid foundation that truly makes crypto essential in everyone’s daily life”.
In CZ’s view, the crypto sector can be compared to cars. In the beginning, there was no highway code, no traffic lights and no seat belts. Laws and safety measures were implemented later. The same thing is happening with cryptocurrencies.
“Clarifying and building the first set of standards is critical for the industry’s continued growth. And Binance wants to be a positive contributor”.
Binance: crypto regulation is like a journey
According to CZ:
“Compliance is a journey – especially in new sectors like crypto. The industry still has a lot of uncertainty. We also recognize that with the growth comes more complexity and more responsibility”.
For its part, Binance hasn’t always gotten everything right, something the CEO acknowledges:
“As a four-year-old startup, Binance still has a lot of room to grow. Binance has grown very quickly and we haven’t always got everything exactly right, but we are learning and improving every day. We hope to clarify and reiterate our commitment to partner with regulators, and that we are proactively hiring more talent, putting in place more systems and processes to protect our users”.
To this end, Binance plans to:
- Expand the team dedicated to working with authorities to ensure services comply with applicable laws.
- Implement partnerships to combat money laundering;
- Localize operations in order to better cooperate with local authorities, as has happened in the United States where Binance.com is not active and it is instead possible to operate via Binance US.
Crypto synonymous with freedom
It’s all about freedom:
“Our vision is to increase freedom and inclusion for a better human society. We firmly believe that our industry will benefit society through the creationing of inclusive financial opportunities. We call this the “freedom of money””.
This is something that CZ believes can only be achieved with the support of regulators and policymakers who must understand the innovations and impact the industry will have in the long run.
Binance is ready to play its part. The CEO concludes:
“We humbly welcome more constructive guidance to help us to grow better.
We humbly welcome more capable talents and experienced advisors to join us to build better.
I and everyone at Binance, are ready and look forward to being a partner in developing and following guidelines that will help the industry grow in a sustainable manner. And together, we will help to increase freedom in the society in a sustainable and responsible way”.